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V1753-19 10 July 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption applies if the sold property was a primary residence up to two years before the transfer

A taxpayer wishes to sell their former primary residence (which ceased to be their main home due to a job relocation in 2017) and reinvest the proceeds into their current home. The DGT rules that the exemption is applicable if the sale takes place within two years of the property ceasing to be the primary residence.

The question raised

Whether the exemption for reinvestment in a primary residence may be applied.

The DGT's ruling

To qualify for the exemption, the transferred property must be the taxpayer's primary residence at the time of sale or must have been so on any day during the two preceding years. In cases of job relocation, the property is considered a primary residence even if the taxpayer has not resided there for three years. Therefore, the sold property retains its status as a primary residence for up to two years after the taxpayer ceased to reside in it.

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